1. Know your credit report
Go to annualcreditreport.com
and get your credit report from all three of the reporting agencies; you get one free report a year from each. This step is important because your credit score can make a huge difference in how much you qualify to borrow and what you pay for the money.
2. Know what other documents will be useful
When you talk with a lender about applying for a home loan, you might need several other records.
3. Know what you can afford
- W-2 forms. Make copies from the past two years.
- Paystubs. Copy your two most recent ones.
- Financial account statements. Collect statements, including those from retirement accounts, for the past few months.
- Lines of credit. If you've opened any in the past six months, you'll need copies of those statements because they might not show up on your credit report.
- Information about vehicles you own. Include make, model, and resale value.
- Auto-loan account information. Include account numbers and statements.
- Credit card account information. Include numbers and types of cards, balances, and minimum payments.
- Other loan account information. Include student loans and personal loans.
- Gifts. If any money for your down payment was given to you, identify how much and where it came from. Be prepared to document that it's a gift and not a loan.
This depends on a few things: Your income and its stability, how much you have for a down payment, and your existing debt level are all elements that come into play here.
A good best practice is to consider how much of your monthly cash flow you want to put into house payments so you don't end up "house poor." Think in terms of what house payment you can handle and still have money for savings, education, vacations, entertainment, childcare, and other priorities.
4. Know your savings status
You'll have to come up with a down payment on a conventional home loan. This is something your Sikorsky Credit Union Home Loan Consultant can help you better understand as far as what options you might be eligible for.
In addition to a down payment, be prepared for these expenses, which you can't roll into your mortgage:
- Closing costs for title search, appraisal fee, loan origination fee, and more
- Utility hook-up charges
- Prepayment of taxes, interest, and property insurance
- Moving expenses
You can expect to shell out for paint, window coverings, appliances, and other basics to make your new place move-in ready.
Once you have considered all of these factors one of Sikorsky Credit Union Home Loan Consultants can help you calculate what you need and how much you want to keep on hand for the inevitable expenses that arise after you buy a house.
Stop by any branch or call 203-377-2252 today. Or, if you would like us to contact you, complete this simple form
and one of our helpful Home Loan Consultants will reach out to you to begin the discussion.
( Photo Credit: David Sacks / Photodisc / Thinkstock 83590736
Buying your first house is an exciting time, but admittedly a little scary, as well. Your allies at Sikorsky Credit Union have your back. Here are five things you should consider before buying your first home.